PSEi breaks out of 7,400

The local stock barometer breached the 7,400 barrier on Tuesday as foreign investors gobbled up local equities on rising optimism on the country’s economic prospects.

Outperforming mixed regional markets, the Philippine Stock Exchange index racked up 104.84 points or 1.43 percent to close at a six-month high of 7,446.49.

This marked the PSEi’s best finish since Oct. 26 last year, when it ended at 7,494.41. The index also saw its biggest single-day gain since Feb. 16 this year.

Joseph Roxas, president of local stock brokerage Eagle Equities Inc., said investors were emboldened by the government’s upbeat forecast on the domestic economy.

It was reported on Tuesday that Economic Planning chief Ernesto Pernia sees the country’s first quarter gross domestic product (GDP) growth coming in at about 7 percent, suggesting a sustained high-growth trajectory that in turn would provide a good backdrop to corporate earnings.

“It’s a breakout,” Roxas said, noting that investors were also emboldened by the steady fiscal assessment from Fitch Ratings alongside the release of market liquidity following last Friday’s listing of Wilcon Depot.

For many weeks, the PSEi had been trading within a range of as low as 7,100 to as high as 7,400. After breaking out of the 7,400 resistance, the index will henceforth test the 7,700 levels, Roxas said.

“The market broke out of its trading range today…This is in contrast to other Asian markets which were mixed. The index should stay above 7,400 and establish a new support level at that area, otherwise the old trading range will pull the index back to it,” said Manny Lisbona, president of PNB Securities.

All counters advanced led by the property counter which gained 2.43 percent while the financial, holding firm and services counters also rose by over 1 percent.

Value turnover for the day was heavy at P11.94 billion. There was relatively heavy net foreign buying amounting to P4.08 billion for the day.

There were 114 advancers that edged out 79 decliners while 42 stocks were unchanged.

Ayala Corp. eked out a 3.06 percent gain while BDO, PLDT, SM Prime, DMCI and Semirara all increased by over 2 percent.

BPI, Metro Pacific, Globe Telecom, Metrobank, JG Summit and Security Bank all firmed up by over 1 percent while URC, SMIC, Jollibee and Puregold also contributed gains.

On the other hand, GT Capital bucked the day’s upswing, declining by 1.23 percent.

Outside of the PSEi, Shell Philippines slipped by 0.55 percent.